VEGAS INC Magazine - Latest Las Vegas business news, features and commentaries about gaming, tourism, real estate and more
Issue link: https://www.ifoldsflip.com/i/77405
IN BUSINESS ENERGY PROPOSED GAS RATE HIKE MOTIVATES LAS VEGANS TO SPEAK OUT By Eli Segall staff writer P aying an extra $3.76 each month may not seem like a burden. A drink at Starbucks can easily cost more. Yet for Angel DeFazio, an elderly Las Vegas woman, paying that much more for her natural-gas bill is a raw deal. As she sees it, Southwest Gas Corp. needs to cut its own expenses, not raise revenue by charging customers more. DeFazio was one of a handful of valley residents who spoke the night of July 26 at a state Public Utilities Commission hearing in which people were given a chance to voice their opinions on South- west's proposed rate hike. They were all critical. DeFazio sat in the front row of the au- dience, alongside her 4-year-old Sheltie, petting him as others spoke. Local util- ity companies, she said after the hear- ing, are "trying to stick it to the public." Las Vegas-based Southwest Gas filed a request with the PUC in April seeking to raise rates in Southern and Northern Nevada. Under the proposal, the aver- age rate increase for a single-family residence in Southern Nevada would be 8.3 percent. This would push up the av- erage monthly bill by $3.76 to $49.05. In Northern Nevada, the average rate increase would be 2.16 percent. This would cause the average monthly bill there to rise by $1.67 to $79.10, accord- ing to the most recent estimates from the company. Southwest is also seeking PUC approv- al to implement a "Gas Infrastructure Replacement" mechanism. This would let the company "recover the invest- ment" of certain infrastructure costs that do not generate additional revenue, according to the commission. As planned by Southwest, the rate hikes would take effect Nov. 1. They are expected to generate an additional $24.9 million of revenue from Southern Nevada and $2 million from the north- ern part of the state, Southwest says. The company's last general rate hike in Nevada was in 2009. According to the PUC, the company says its existing rates and charges do not generate "sufficient revenue" for a reasonable return on its investment. The proposed rate hike would be used only to recover operating costs, not the cost of natural gas, said Southwest spokeswoman Sonya Headen. According to Headen, the company needs a "fair rate of return" to afford projects and attract investors. "It's important to have a healthy util- ity," she said. The company's operating costs have | 6 AUGUST 2012 | 9 Scan this with your mobile device. Energy Audit Rebate! Learn how and where to cut costs with an energy audit. Available Rebate — 50% up to $5,000 on a facility audit Take advantage of additional energy-efficient rebates available such as custom and boiler rebates. For details on eligibility and requirements, please visit www.swgasliving.com/vegasinc or call our Energy Specialists at 1-800-654-2765. been rising. At the same time, its overall profits have also gone up. Southwest, which has 1.9 million cus- tomers in Arizona, Nevada and Califor- nia, had $1.66 billion of total operating expenses in the year ending March 31. During that period, it earned roughly $123 million of profit. For the year ending March 31, 2011, the company had $1.55 billion of oper- ating costs and $108 million of profit, according to a filing with the Securities and Exchange Commission. Jonathan Friedrich, a retired general contractor, also spoke at the hearing July 26 and was critical of the proposed increase. He said afterward that his property tax was roughly $150 higher than last year's. When told after the hearing that the rate hike appears relatively small, he said: "Try living on a fixed income." The PUC will hold more hearings on the proposal in September. Smarter Greener Better® Rebates For Your Business! Save money and energy with rebates. Commercial Equipment Rebates! Solar Water Heating Rebates! Solar water heating rebates are available for residential, small business, school, non-profit, and public properties. Available Rebates — Up to 50% of system cost or up to $30,000 Natural gas fryers, combination ovens, storage and tankless water heaters, and griddles. Available Rebates — $200 – $1,350 on qualifying equipment